The GREAT interview with Edwina Dunn - Making it Happen

The GREAT interview with Edwina Dunn - Making it Happen

13 July 2012

When I was six, I desperately wanted to be a long distance truck driver. I thought it was simply the most glamorous thing – something about those big rigs, the travelling and the lights of the motorway at night.

We all had those dreams when we were young – of becoming doctors, sports stars, singers – the list is endless. My daughter Rowena dreamed of becoming a fairy – and she would tip toe around the garden in a dress of white tulle searching for fairies that she could fly around with (she’ll thank me for writing this).

To be realistic, very few people can attain their early dreams. Rowena certainly isn’t ever going to be a fairy – especially after those teenage and university years!

But those early dreams do seem to reveal a universal truth:

People always look to the future – setting new plans, thinking of new ideas and dreaming new dreams.

With that realisation of human nature comes a hugely important question: ‘how do you make it happen?’

‘Making it happen’ is the difference between the dreamers and the achievers, and the subject of the question I am asked most about my career. But there isn’t a highway to success – there are only millions upon millions of personalised paths. So when the GREAT Initiative asked me to write this article, I thought I would share some of the conclusions I’ve drawn from a career building a global business.

These are not intended as a blueprint, but will perhaps serve as a catalyst for your own thinking and your own unique approach to how you get things done. How you make things happen.

The power of the idea lies in a plan.

You know when you become slightly obsessed with an idea or thought? Where your thought patterns keep going back to a particular topic and you feel energised by it but you don’t know quite where it’s heading? That is how dunnhumby started in 1989 – my conversations with Clive (Humby, my husband) kept coming back to two conclusions we’d drawn.

The first was that people are different and therefore respond differently to different things. People are much more likely to respond well if you talk to them about things they are interested in. It’s a basic rule of human relationships – after all we tend to be friends with people who share our interests. The phrase we used to use was ‘birds of a feather flock together’. It seems obvious now, but at the time this rule hadn’t really been applied to business yet. That was the first thing spinning around our heads.

The second was that companies were beginning to hold and have access to huge amounts of data on their customers. But they weren’t using it.

So the question we grappled with was ‘can these two elements be reconciled?’ We were convinced they could be. That was the simple idea and principle we had in 1989: customer data could be used to help companies truly put their customers first and deliver an offer that was personalised and relevant.

When we founded dunnhumby, we started work in the back bedroom of our house. By the time we sold our last stake and retired from the business in February 2011, it had grown to a company of 1500 people working in 25 countries with a turnover rapidly passing half a billion dollars. Along the way we’d helped Tesco develop their pioneering loyalty programme Clubcard and become the Number 1 UK retailer; helped the US super-retailer, Kroger, achieve unprecedented consecutive like-for-like growth, gaining ground against WalMart; and we were enormously privileged to work with some of the biggest and best brands in the world.

So that initial idea that was developed over countless conversations with Clive has become something very real. Something that now touches the lives of more than 350 million people around the world.

But lots of people have ideas. I think we probably all know someone who keeps coming up with ideas for the next ‘big thing’. It never happens. The thing they were excited about, in some cases even bored you to death with, never comes to pass. The big question therefore has to be – how do you make it happen?

Ideas – however great – remain just ideas unless people make them happen.

I love the quote by Voltaire: “Each player must accept the cards life deals him or her; once they are in hand, he or she alone must decide how to play the cards in order to win the game.”

It encapsulates the concept that you play a really proactive role in your life. Very little just happens – you have to make it happen. So the first step isn’t just to have an idea, but to really work it through and have a detailed plan as to how you are going to bring it to life.

Having the right objective.

In developing the right plan, you also have to have the right objective. Again, it seems blindingly obvious, but you would be surprised – or maybe you wouldn’t – about how many people and companies get it wrong.

One of the key moments in dunnhumby’s growth was the decision to partner with Kroger in the US. The partnership wasn’t in question, but the format of it was. Clive and I were leaning from early on towards a Joint-Venture model for the new company, dunnhumbyUSA, in which half was owned by Kroger and half by dunnhumby.

At the time a lot of people came up to us arguing we should build the relationship as a regular service provider. They made perfectly rational arguments – saying things such as “But you’re just giving away half the money you’re going to make”.

If we had viewed the objective as “We want to make as much money as possible”, we may well have chosen the latter route, which promised to yield bigger short-term results. But we realised that for our business to be sustainably successful, we would have to have Kroger’s buy-in. Therefore the real objective was “We want a long-term partnership with Kroger that will lead to both of us being successful”.

So in the face of popular opinion, we created a Joint Venture, which would mean that both Kroger and dunnhumby would be determined and invested in making the hard choices that would make a difference to both our businesses. dunnhumbyUSA is now the biggest part of the group and the partnership has delivered success to Kroger and dunnhumby that we couldn’t have imagined in those early days.

Similarly, when Tesco expanded internationally, they could have simply copy and pasted their UK business model into all countries. But they realised that the real objective wasn’t to replicate exactly, but rather replicate the principle – to be a retailer led by understanding the customer.

So they built stores with live fish and shellfish in Korea, because Koreans are used to and like the atmosphere of the traditional wet market, a chaotic, noisy environment a whole world away from the calm airy aisles of Tesco UK. In Malaysia, Tesco have built a whole shopping mall, with other stores leased out because consumers there like to hang out in a shopping mall for a whole day.

This principle of really making sure you have the right objective can be seen in pretty much all spheres of life. I recently read something interesting on Neville Chamberlain that demonstrates the point aptly.

Chamberlain is condemned in history as the man who tried to appease Hitler. But what was the issue of the day? Chamberlain saw the central question as “can Hitler be contained?” And he thought he could and rationally he should have been right – why wouldn’t Hitler be satisfied with what he had at that point? So Chamberlain got the right answer to the wrong fundamental question.

Churchill got it right: does Hitler and fascism represent a force so strong, ambitious and virulent that it has to be met with force and removed? History is written and decided by those perceptions.

It’s one of the reasons that I’m so happy to support the GREAT Initiative. Gender equality and female empowerment in developing countries is so important because it has been proven to have long-term impact. The objective isn’t ‘what is the most exciting thing to do’, but rather ‘what works best’. In a sector that has many examples of badly applied aid affecting its reputation, sensible and effective aid is vital.

So it is important to have a goal, but even more so is to make sure that it’s the right one.

The importance of a collaboration of skills

With dunnhumby we set strong five-year plans to reach our objectives, but one of the biggest challenges in meeting those was building the teams that made it happen. dunnhumby certainly hasn’t been built on the successes of any one person – not me and not Clive. Right from its inception in that back bedroom in 1989 it has been a project of collaboration.

Clive had the visionary ideas and I made them happen. I was once told that every successful business needs a genius and – forgive me, but I’m quoting verbatim – a bastard. That’s always worried me, because I know I’m not the genius! However, it would be fair to say that we wouldn’t have been able to achieve what we did without each other’s skills. And the very complementary skills of the people who worked with us.

Distribution and delegation of work is key to any enterprise. But delegation is not about passing down work, but rather it’s about matching somebody’s strengths to a particular task at hand. It’s ensuring you have the right person with the right skills to do the job, be they senior, junior or equal to you – or even you yourself. Once you have the right people, you have to take the big step and trust them to actually get on with the job.

One of my favourite examples is from the famous biography of Abraham Lincoln – Team of Rivals, which describes how Lincoln brought his four most serious rivals for the presidency into his cabinet. I take great inspiration from that, because the reason Lincoln did it was that he realised the four men were, simply put, the most qualified men in the country for the job. The right people with the right skills.

That was combined with Lincoln’s unfailing dedication to making his ‘it’ – his presidency with its many, many challenges – the star, rather than any desire to be seen as the one and only person who could solve all of the country’s problems. So he delegated vital tasks to his rivals – a move of courage and brilliance.

If you are clear on what each individual’s roles is and all have a common purpose, you can achieve great things – certainly more than the sum of your parts. Again this also relates to the work of GREAT – communities all around the world could benefit hugely if the underutilised skills, ingenuity and talents of women were brought into the mix.

Making it happen

Those are the three elements that I have learnt are most central are vital to ‘making it happen’:

  • The power of an idea lies in a plan
  • Make sure you have the right objective
  • The importance of a collaboration of skills

As I said, these three points aren’t an exact blueprint, but they are three principles that have served me well in 21 years of building a business, setting visions, taking tough decisions and learning from the mistakes as well as the successes.

The future of Customer Engagement

After Clive and I retired from dunnhumby last year, how to make it happen is one of two questions we’ve often been asked. The other also goes back to that essential human truth of always looking forward – what does the future of customer engagement hold?

To answer this question with complete honesty, we need to put our work with dunnhumby and our retail partners into context. When we began work with Tesco on Clubcard, the concept and its applications was completely radical and new in its scope and delivery. It may seem strange now that ‘loyalty programmes’ are so ubiquitous, but the same goes for mobiles and the internet.

It’s a model of customer engagement that is predicated on delivering relevant value to customers, focused on functional rewards with a financial bias that appeals to the customer’s rational side. That personalisation element is still going to be hugely important for retailers and brands and their performance, but whereas once it was revolutionary, it is now the minimum expected.

As we look at the world today and the future of customer engagement there are several dimensions to the landscape that are important to consider:

customer loyalty is a myth

Customers are rarely if ever loyal to a brand. Even if they frequently buy your product, they will still be spending a large percentage of their purse or wallet on other brands. With the traditional models of customer engagement being based in large part on financial rationale, customer switching is to a large extent determined by price.

So these ‘loyalty programmes’ today represent a more efficient and compelling route to delivering a price promotion and discount, but not a true route to loyalty. The challenge to brands is to offer customers something that appeals to their emotional loyalties (which doesn’t necessarily have to be to the brand’s product).

loyalty lives in lifestyles

There are a few brands that do have segments of very loyal customers - brands such as Apple and Harley Davidson. If you look at these brands closely, they come to represent and define a lifestyle. That’s where true loyalty exists - in the emotional connection between people and the lives they lead, the content and activities they value. The challenge to brands isn’t necessarily to become a lifestyle, but to make themselves as integral to one as they can.

everyone has the same guns

With the ubiquity of so-called ‘loyalty programmes’ and promotions, the battle on price has reached a point where everyone has the same guns. When everyone uses the same levers, nobody stands out, especially when customers have become so savvy to the strategy and tactics. What we call ‘cherry-pickers’ have become commonplace – consumers who shop around and pick the best deals relentlessly. Customers are turning the commercial weapon of promotional power back on the brands themselves.

So the challenge to brands is to differentiate themselves in terms of the value they offer customers.

While the personalisation we pioneered with dunnhumby is still a crucial part of the game – it is no longer likely to be enough. Everyone is hunting for the next currency to excite and engage customers. For instance, we discovered that while ready meals are popular in the UK, in France the preferred method is to have ‘ready-to-cook meals’, which means you get the ingredients you need to put together a fresh meal. Now imagine that after a while, two retailers offer these meals at the same price. How would you choose? Well – imagine if one of them offered you access to exclusive content from your favourite TV chef?

If cooking is your thing, you are likely to value that. The sales of Jamie Oliver’s iPhone app reveal to what extent content is valued. 4.3 million people downloaded the app, but if the usual app development trends are followed, only 5% of that (still a lot) pay for the apps rich content beyond the sample.

People want content and value it, especially if it is exclusive. But they rarely want to pay for it any more. So the challenge for brands is still to offer relevant value to customers. It is just a different type of value, an emotional one, rather than a financial and rational one. If brands can become the conduit for their customers to reach exclusive content that they want, they leverage those emotional ties, which drive purchase.

We’ve already seen it at work – for American Express and O2 and their offers of priority access to tickets. But that is only the beginning – the true future lies in delivering valued content with mass appeal that everyone can access.

How can we make it happen? It all starts with an idea. I think Clive has had a good one, but that‘s for another day.